You are playing a fair gamble with your initial wealth $1,000,000. The expected return of each play of the gamble is 0% since it is a fair gamble. If you try to play this fair gamble 100,000 times, the probability that your wealth after the gambles is higher than your initial wealth is 50% since it is a fair gamble. Assume you bet the same fixed amount at each play and you are not allowed to borrow money.

A. True

B. False

Question

Justus Mcfarland

Business

8 January, 11:40

You are playing a fair gamble with your initial wealth $1,000,000. The expected return of each play of the gamble is 0% since it is a fair gamble. If you try to play this fair gamble 100,000 times, the probability that your wealth after the gambles is higher than your initial wealth is 50% since it is a fair gamble. Assume you bet the same fixed amount at each play and you are not allowed to borrow money.

A. True

B. False

+2

Answers (1)

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Brennan Frey · Answer 1

False

Explanation:

The answer to this question is False because this is a fair play game which indicates that the number of wins is approximately same as the losses. If a person wins and losses in gambling the net outcome would nearly remain unchanged as the increase by wins will be decreased by losing at gambling.